A NACH return charge is a fee your bank takes when a NACH debit, such as an EMI or a SIP, could not be paid from your account, most often because the balance was too low on the day. Each bank sets its own amount in its schedule of charges, and the company that tried to collect may charge a late fee of its own.
Why a NACH debit is returned
The common reason is not enough balance when the debit is presented. A debit can also be returned for a problem with the mandate or the account itself.
How it shows on a statement
Banks word the charge differently. Look for a debit that names NACH or ACH together with a word like return or bounce, and in many cases a separate line for the tax on that charge.
Avoiding it
Keep enough money in the account before the debit date. The date is set in the mandate, and the company that collects the payment can tell you when it is due.
Example lines
Made-up lines in the usual shape. Your bank's wording will differ.
NACH RETURN CHARGES 100000000001Illustrative wording of the fee; your bank's will differ.
Questions
How much is the NACH return charge?
There is no single figure. Each bank publishes its own in its schedule of service charges, and it can differ by account type. Check your bank's current schedule rather than a number quoted elsewhere.
Is the EMI or SIP still due after a return?
Yes. A returned debit means nothing was paid, so the lender, fund house or insurer will try again or ask you to pay another way.